BEIJING – China’s iron ore futures moved in a tight range on Thursday morning, following two consecutive sessions of losses, after Beijing rolled out a raft of stimulus measures aimed at shoring up its slowing economy that will stoke construction projects.
The most-traded iron ore futures on the Dalian Commodity Exchange saw the contract for January 2020 delivery rise as much as 0.4 percent to 648 yuan ($92.06) per ton earlier in the session, before reversing course to edge down 0.1 percent to 645 yuan.
The construction steel rebar futures on the Shanghai Futures Exchange, for January 2020 delivery fell 0.3 percent to 3,593 yuan per ton, narrowing losses compared with the precious two sessions.
The Ministry of Finance said on Wednesday that it would bring forward 1 trillion yuan ($142 billion) of the 2020 local government special bonds quota to this year, followed by a State Council document on lowering minimum capital requirement ratio for some infrastructure projects.
“The stimulus is good news for the economy as both infrastructure projects and local government investments in China face capital shortages,” said Liu Xinwei, iron and steel researcher at Sublime China Information.
But the ferrous market remains cautious as it expects a “soft landing” in terms of next year’s demand, Liu added.
Hot-rolled coil, used in cars and home appliances, inched down 0.1 percent to 3,523 yuan per ton. – Reuters